Yorkshire Water senior executives banned from bonuses by Government after raking in £13m in last decade
Yorkshire Water’s two most senior executives have been banned from taking bonuses by the Government, as it is today revealed that in the last decade alone, despite repeated sewage spills, its chief executive and chief financial officer raked in almost £13m in bonus payments.
In 2024, chief executive Nicola Shaw was awarded a base salary of £585,000, more than three times that of the Prime Minister, along with a bonus of £371,000 and additional benefits of £72,000.
This is despite the company being one of the worst offenders when it comes to sewage overflows, and the Environment Agency giving Yorkshire Water a “red” rating due to rising pollution incidents.
Sewage spills have contributed to a situation in which no single river in Yorkshire is considered to be in good overall health, while Ilkley Beach is the most polluted waterway in the country.
In March, Yorkshire Water agreed to pay regulator Ofwat a £40m fine, and now, as a result, Ms Shaw and chief financial officer Paul Inman will be banned from taking a bonus for the 2024-2025 financial year.
Government figures show that over the last decade Yorkshire Water’s CEO and CFO have taken almost £13m in bonuses, more even than those at under-fire Thames Water.
Yet, in the last seven years, the company’s debt has risen from £4.2bn to £6.8bn, requiring £275m to be spent each year servicing the interest.
That puts Yorkshire Water’s debt to equity ratio at 70 per cent, which Ofwat describes as unstable.
On top of this, customers’ bills rose by almost a third in April, £123 on average, while it was recently revealed that £345m of dividends were paid out to the ownership group in 2024.
The Government said the bonus ban - which comes as Labour’s Water (Special Measures) Act has become law - was made after the Ofwat fine, for environmental and consumer failures, and a category one pollution incident in Kirklees in December 2024.
This is when a sewage leak has a serious, extensive or persistent impact on the environment, people or property.
Yorkshire Water was one of six companies - including Thames Water and United Utilities - which are banned from bonuses for the 2024-25 financial year.
Environment Secretary Steve Reed said: “Water company bosses, like anyone else, should only get bonuses if they’ve performed well, certainly not if they’ve failed to tackle water pollution.
“Undeserved bonuses will now be banned as part of the Government’s plan to clean up our rivers, lakes and seas for good. Promise made, promise delivered.”
Ms Shaw, the Yorkshire Water CEO, recently defended her massive bonus to MPs on the Commons Environment Committee.
She said: “The shareholders and board of Yorkshire Water’s remuneration committee decided to set us really stretching targets in regard to a number of things.
“In particular we improved and continue to improve on leakage and in relation to our staff engagement and staff safety and they wanted to reflect that in what had been a difficult year.
“They also recognised that we did nowhere nearly well enough in relation to our outcomes in relation to the environment and removed any bonus in relation to the environment.”
Yorkshire Water said that Ms Shaw had already chosen not to take a bonus this year “due to the company’s performance on pollution and a recognition that we need to do better for the communities we serve and earn trust”.
“She has also taken the decision to waive her entitlement to an additional bonus that would have vested under our longer-term incentive scheme,” a spokesperson said.
“We are determined to make improvements to our performance so we can deliver our part in creating a thriving Yorkshire, doing right for our customers and the environment.”